The equity revolution in Swiss law – daura leads the way
The application of distributed electronic registers (distributed ledger technology) and blockchain technology are among the most promising developments in digitalization. The Federal Council has enacted elements of the DLT proposal as of 01 February 2021, which allows the introduction of uncertificated securities. This with the intention of creating innovation-friendly framework conditions so that Switzerland can position itself as an attractive location in the field of new technologies by means of legal certainty, efficient regulation good reputation. daura, as a pioneer, offers its customers the issuance of shares based on register value rights from the beginning.
What used to be held as a physical, paper-based security can now be replaced by a digital security. Through the introduction of uncertificated securities (Art. 973d ff. nOR), these digital securities (e.g. shares) can be issued via a DLT-based infrastructure. The advantages of issuing shares in the form of uncertificated securities are obvious: The shareholder can hold his digital share directly himself, transaction costs are reduced, the administration of many shareholders is simplified for companies and the share can be linked to other functions such as voting at a general assembly. This not only makes the work of the board of directors easier – the blockchain as a tamper-proof register increases the legal security and traceability of all transfers for the company and the investor.
Opportunities for Swiss stock companies
Companies already have the option of issuing their shares via the daura platform as a simple uncertificated security. Digitization makes it possible to carry out further activities such as capital increases and general assembly efficiently and inexpensively. Investors can register on the platform free of charge and digitally manage their holdings quickly and easily. daura will offer companies the opportunity to issue their shares in the form of uncertificated securities via the daura platform or to convert their existing shares from February 1, 2021. «The provision is great important for the ongoing «SME Marketplace» project of Berner Kantonalbank. The possibility to issue shares in the form of uncertificated securities paves the way for the future trading of digital shares via OTC-X», says Urs N. Grunder, Head of Trading / Financial Institutions at Berner Kantonalbank AG.
First pilot customers
For the introduction of uncertificated securities, several companies have already agreed to map their shares under the new law on daura’s blockchain solution. MME Compliance AG, a consulting firm specializing in law, tax and compliance, will convert its simple uncertificated securities to register value rights via the daura platform as of February 1, 2021. «The introduction of uncertificated securities marks another evolutionary step towards the dematerialization of shares, which will make it much easier to issue, hold and transfer assets such as shares», said Andreas Rudolf, Legal Partner at MME Legal Tax Compliance.
Innofactory AG, a subsidiary of Berner Kantonalbank and Hypothekarbank Lenzburg has also decided to take this step. In March, the company is using daura AG’s general assembly module to make the switch to uncertificated securities. Mark Chardonnens, CEO of Innofactory AG: «As an innovative company, it was quickly clear to us that we would take this new path. The conversion to register value rights is a profitable situation for us in every aspect».
«The DLT law amendment creates a new era in the issuance, trading and custody of shares with great international potential for Switzerland as a innovative location», says Peter Schnürer, CEO of daura AG. «It was important to us that our customers could benefit directly».
Checklist for companies
- Amendment of the articles of association:
- Authorization in the Articles of Association to issue register value rights (Art. 973d nOR)
- Exclusion of the shareholders’ right to issue a physical certificate
- The prerequisite for the amendment of the Articles of Association is a resolution of the General Assembly of Shareholders
- Notarization of the new Articles of Association, commercial register registration
- Resolution of the General Assembly of Shareholders on the issuance of registered securities and the conditions of registration; in the event of a corresponding authorization in the Articles of Association, the Board of Directors may also resolve on the issuance of registered securities and determine the conditions of registration
- Registration on daura
About daura AG:
The technology company daura digitises the shares of small, medium-sized and established companies from Switzerland using blockchain technology. The daura platform will make the processing of capital increases more convenient, simplify ledger management and increase the efficiency of shareholder meetings. It allows large groups of people to be linked by shares to the company. Shareholders on the platform can access new opportunities to invest in Swiss SMEs and can use daura to digitally manage their company shares themselves. daura is a joint venture by the established and innovative Swiss partners Swisscom, SIX, Sygnum Bank, Luka Müller (MME) and Christian Wenger (Wenger & Vieli).
Find out more: www.daura.ch